Oct 252022

U.S. Department of the Interior Announces First Offshore Wind Lease Sale in the Pacific

Greta T. Carlson and Samuel B. Boxerman
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On October 18, 2022, the U.S. Department of the Interior (DOI) announced that the Bureau of Ocean Energy Management (BOEM) will auction offshore wind energy leases along the outer continental shelf off the coast of central and northern California (the Announcement). The sale will be the first-ever offshore wind lease sale on the West Coast and the first U.S. sale to support potential commercial-scale floating offshore wind energy development. According to the Announcement, the five lease areas, totaling approximately 373,268 acres, have the potential to produce over 4.5 GW of offshore wind energy and power more than 1.5 million homes.

The Final Sale Notice (FSN), published in the Federal Register on October 21, 2022, details the lease areas, lease terms and conditions, and auction rules (the FSN). The FSN identifies 43 companies eligible to participate in the auction. It also provides a series of lease stipulations designed to protect the environment; secure environmental justice; encourage construction efficiency; promote the development of a robust and resilient domestic supply chain; and advance lessee engagement with government agencies, Tribes, and affected communities. Such lease stipulations include requirements to prepare semiannual progress reports and to minimize potential adverse effects on protected species and any potentially affected communities.

The FSN explains that BOEM will use a multiple-factor bidding system for the sale. BOEM will provide bidding credits for bidders who have committed to enter into a community benefit agreement, support workforce training programs for the floating offshore wind industry, and/or develop a U.S. domestic supply chain for the floating offshore wind industry.

The auction will be held online at 7 a.m. PT on December 6, 2022.

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.

Greta T. Carlson

Samuel B. Boxerman

Washington, D.C.

sboxerman@sidley.com

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